If you have a great idea, but you are lacking capital, resources, or market knowledge, a joint venture may be the best approach for turning your business to turn your idea into reality. A joint venture is a business agreement in which two or more companies agree to share their resources, usually for a specific project or shared goal. Traditionally, a joint venture is when two or more businesses come together to achieve a common goal or penetrate into a specific consumer market. The exchanges of ideas and resources take place under a contractual agreement for the duration of an agreed upon period of time. Here’s a few of the benefits of a joint venture:

 

Shared responsibilities and resources

When the joint venture is successful, the businesses pool the profits and share it amongst themselves per the contract. Similarly, a failed venture means that the companies involved will have to pay for their losses as written in the agreement.

Many companies will enter joint ventures because they do not know what kind of resources it will take to reach the market they are trying to penetrate. When joining hands with another business, you are able to access the resources of that business without having to spend too much money on acquiring capital.

 

Flexibility for the member companies

Unlike permanent mergers or acquisitions, joint ventures are flexible as they are temporary and require a contract that specifies a date until which the companies will be sharing resources together. The companies that are entering the venture do not have to create a new business entity under which the project will be finalized, which provides adaptability not typically found in many other business types. The participating companies do not have to give up any control of their business to the other company and they do not have to halt other operations for the ongoing project.

 

Credibly’s growth journey

Reaching number thirty-five on the Inc. 500 list in 2014, just three years after its establishment, Credibly’s story is one to be awed at. Their joint partnership with Crestmark Bank uniquely positioned Credibly for long-term success by instilling a strong culture of compliance and emphasis on risk management that is uncommon in the currently unregulated space.

The small business lender went on to release a proprietary scoring model that more accurately assesses the overall health of businesses and its probability of repayment. In 2015, the business introduced other financing solutions such as its working capital loan and business expansion loan to more effectively meet the needs of small and medium-sized businesses nationwide. In 2017, they were awarded servicing rights to a competitor’s $250 million portfolio, chosen for its risk management. Since then, the company has provided access to over $1B in SMB financing and securitized its portfolio, further proving the quality of its operations.

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